Iowa Department of Natural Resources
Environmental Services Division

For Immediate Release
         May 18, 2007

MEDIA CONTACT:  Brian Crowe at (515) 281-8518 (office) or (515)
250-4660 (cell)

GASOLINE IN IOWA UP 15 PERCENT IN THE LAST MONTH
DES MOINES -- Gasoline prices have continued to climb higher into
uncharted territory in Iowa as supply issues continue across the state
into mid-May. Record unscheduled refinery shutdowns and lower refinery
output in 2007 have caused supply chain issues while gasoline demand
increases with summer approaching.

Recent outages in Wynnewood, Okla., Great Bend, Kan., Houston, Texas,
Cenex Laurel, Mont., and low output from the large Whiting Refinery in
northwest Indiana, continue to complicate supply issues. Reports of very
low gasoline supply in Iowa, Arkansas, Colorado, Utah, and in other
parts of the country have led to reports of bagged pumps, prolonged
supplier allocations and some convenience store shut downs due to lack
of product.

Iowa gasoline prices in May have surpassed all other gasoline price
records. Prices are at a record high in Iowa, averaging $3.17 per gallon
of 10 percent ethanol blended mid-grade gasoline; a 17 percent increase
from the April price of $2.71 per gallon for the same blend. Iowa prices
are $0.06 above the national average of $3.11 per gallon, mostly because
of the supply snafu and Iowa’s location in the middle of the country
far from oil refinery centers. Diesel fuel is down 2.4 percent this
month at $2.92 per gallon, $0.07 lower than the $2.99 price per gallon
in April.

Iowa Governor Chet Culver signed on to a letter with governors from
states across the country to request that Congress initiate an inquiry
into escalating gas prices. In a press release issued May 16, Culver
said, “Working Iowa families are struggling to keep up with these
dramatic spikes in gasoline costs. It's not even Memorial Day and the
cost of gas is well over $3 per gallon - with no real explanation from
the industry on why costs keep rising. Now more than ever it is clear we
need to wean ourselves off foreign oil, and there is no better
positioned state than Iowa to do just that. E-85 is well below $3 per
gallon and I encourage Iowans to explore flex-fuel options as we
continue to work to find new and efficient alternative fuels.”

Individuals are also taking action as a nationwide gasoline boycott for
May 15 was attempted to be organized through blogs and popular Web sites
like Myspace.com.

"The higher gas prices are affecting everyone and everything, right
down to food prices, but I think that we can put to rest for now the
notions of $4.00 per gallon gasoline," said Brian Crowe, a DNR energy
analyst. "We know that prices have gone up dramatically in recent
weeks, but when the refineries come back on-line and hit peak summer
production, we will see more product in Iowa, fewer supply issues, and
more price stabilization."

United States crude oil stocks rose 2.6 percent in May to 342.2 million
barrels, and have remained steady in recent weeks. Stocks are up even
though refinery output is down.

On May 16, natural gas was trading at $7.60/MMBtu, $0.07 higher than
last month, and $1.52 higher than the price of natural gas at this time
last year, a 25 percent increase. Prices are falling across much of the
country as warmer weather has become steady in the lower 48 states and
supplies grow.

A survey completed by the DNR on May 15 indicated that the average
retail price of heating oil in Iowa was $2.57 per gallon, the same price
as last month and $0.67 higher than the price of heating oil at this
time last year. The same survey found that propane was selling for an
average of $1.55 per gallon across the state, $0.03 higher than a month
ago, and $0.31 higher than the price at this time last year.

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